Quattro purchase seen as defensive move for iPhone, offensive for tablet

Apple is likely looking to get a piece of the mobile advertising space on its own App Store, but is also looking to dominate ads on its forthcoming tablet from the get-go with the purchase of Quattro Wireless, one analyst told AppleInsider.

Tole Hart, research director, consumer services with Gartner, said Apple's $275 million acquisition of Quattro will give the Cupertino, Calif., company flexibility not only with App Store software, but also on mobile Web sites tailored specifically for the iPhone. In that respect it's a defensive move to fend off its rival, Google.

As Google encroaches on Apple's smartphone market with Android, Apple is likely looking to retain some control on its own platform, Hart said. Google is already the largest online advertiser, and the acquisition of AdMob, if approved by the Federal Trade Commission, will make it a dominant force in the mobile advertising space.

But while Apple is playing catch-up with Google in the iPhone advertising space, it can get a head start on everyone else with the forthcoming multimedia tablet device it is expected to announce this month and release in March.

"I think this is more of an offensive move for the tablet," Hart told AppleInsider, "and if they had to do it over again with the iPhone and iTouch, they might have more control over the advertising. The tablet gives them a second crack at this."

Earlier Tuesday, Andy Miller, CEO of Quattro Wireless, confirmed Apple purchased his company. Miller, who has been named vice president of Mobile Advertising at Apple, said the offerings and services provided by Quattro would not change in the immediate future.

"Together with Apple, we look forward to developing exciting new opportunities in the future that will benefit our customers," he said.

Apple's interest in the mobile advertising space is not new. Before it was acquired by Google for $750 million, AdMob was approached by Apple. The terms of the two companies' discussions are unknown.

Hart said Apple is likely to allow other services to place advertisements within App Store software. But Apple could make it easier or allow a more robust feature set for developers who embrace the homegrown advertising service.

"I think they want a piece of the iPhone and iPod touch action," he said. "They do want to let other ad networks in, because they do not want to stifle developers."

I completely disagree, this has nothing to do with "control over advertising".

Apple can no longer charge the premium they were charging for their computers and phones and iPods as the market catches up with them feature wize (i.e. Android, Win 7). This is about subsidizing the loss in revenue on their computers with the revenue for advertising. Look at what Google has been able to accomplish with an entire revenue stream from advertising. It's a goldmine.

I completely disagree, this has nothing to do with "control over advertising".

Apple can no longer charge the premium they were charging for their computers and phones and iPods as the market catches up with them feature wize (i.e. Android, Win 7). This is about subsidizing the loss in revenue on their computers with the revenue for advertising. Look at what Google has been able to accomplish with an entire revenue stream from advertising. It's a goldmine.

Apple will likely move into a "branded search" in the next 2 years. Search and ads go together.

Not necessarily, but we'll see.

The AppleTV does not have a browser. Apple controls the internet access through the device. YouTube, iTMS, and a few other sites are the only allowed internet connectivity. So Apple controls the pipe. Apple's rumored subscription model for the AppleTV could be subsidized by commercials (i.e. web born advertisements). That's one possibility.

Next, the iSlate (whatever it is called) may also be a controlled device. In other words, no browser will ship with it. The iTMS and subscriptions services may be controlled outside of the browser. No browser means Apple has a captive audience to advertise to without competition.

We don't do search on television (generally) but we get advertisements so I really don't see a need for Apple to get into the search game.

I highly doubt we'll see Apple doing advertisement-subsidised products - it's the oposite end of the price range from the market Apple is usually in, and not a move that would make Apple customers happy.

I completely disagree, this has nothing to do with "control over advertising".

Apple can no longer charge the premium they were charging for their computers and phones and iPods as the market catches up with them feature wize (i.e. Android, Win 7). This is about subsidizing the loss in revenue on their computers with the revenue for advertising. Look at what Google has been able to accomplish with an entire revenue stream from advertising. It's a goldmine.

This means less expensive stuff from Apple

What a crock !!

People will always be willing to pay a premium for great design and great user experience, not to mention products that simplify life and save time by making things easier.

Neither Windows 7 nor Android come even close to the "Apple experience."

"Last year, the FCC opened TV "white spaces" for use by unlicensed wireless devices, but this "WiFi on steroids" won't be shooting up until the FCC also approves the databases that will be necessary to avoid interference. Today, Google announced that it plans to run one copy of the database itself, and it assured the FCC that it has the cash to do so for a minimum of five years."

Google is the dominant force on desktops, laptops, netbooks but as tech companies like Apple shift their business model towards iphones, tablets etc.. Google naturally need to act now to ensure they dominate on those too. Self preservation.

Apple however, can capitalise on this growing market hence the Quattro purchase. I don't see it as a defensive move against Google, they simply didn't get what they originally wanted in AdMob, so have gone for plan B.

The deal for Apple is better value as this will bring additional revenue. Where Google's purchase is more a case of maintaining what they have. There isn't a war between Google and Apple over this just a shift in strategy.

The Android project is also just another Google strategy for more advertising space.

A reputation is not built upon the restful domain of one's comfort zone; it is made out of stalwart exposition of your core beliefs, for all challenges to disprove them as irrelevant hubris.- Berp...

The big problem for Google is that their only source of revenue is their ads, which is fine so long as they can control the market, but if Apple can get a major beachhead in mobile ads and Google's deal is shot down by the feds it could hurt them. Also, at some point somebody will come out with a better way to search and it may not be Google, or companies will just use apps to advertise and search engines will become less important to them for advertisement. Some tech pundit wrote about that possibility. The one advantage that Google has is that a lot of companies want to use their OS, but if the number of companies using the OS does not match the ad revenue that would be a problem. You have lots of users but your not making money off of them. It's interesting.

Don't need to compete with Google - I just want a search engine where I can:

Search say "Dylan" and get a Top 100 Legit Sites listed (I don't care about Moe's Dylan shrine.net) with a dashboard tied to the iTunes network where I can listen to samples, and preview videos, movies, and buy it right there. But that's not all, I want it as part of my MobileMe account (just in case there is something relative in my email that I didn't remember) and on top of that, my computer's spotlight index so it shows me what would have shown up on my Mac at home. (Obviously approved folder list) This information would not be difficult to organize on a results list. (IMO)

Owning a Mac would not be a requirement to use the search engine but you would need to have a MobileMe / iTunes account to log in.

Throw in Quattro, iMobile devices, apple.com into the blender and you have my vote for top preferred search engine...

"... Apple is likely looking to retain some control on its own platform, Hart said."

I think this says it. To my thinking, Apple' bread and butter is hardware - secondarily SW and Services. However, it understands that a monopoly - or pseudo-monopoly - in any core area leads to degradation of 1- their ability to control the device, and 2- end-user experience. Just as I am glad that Android provides competition to iPhone, I see a need for something to balance Google's dominance in search/ads.